Materials ended almost 0.9% lower to lead nearly all S&P 500 sectors lower. Only utilities gained on the day

A rebound in oil prices, easy monetary policy and better-than-expected US economic data left major indices with gains for the quarter despite losses from the first six weeks of the year, when stocks fell sharply amid concerns about the global economy and an unclear course for the world’s central banks

Boeing was the greatest contributor to declines in the Dow, down 1.28% and IBM contributed the most to gains, rising 2.05%. Morgan Stanley on Thursday raised its price target on IBM to $168 from $140 based on the perspective the firm is "beginning to show a path toward revenue monetisation" in its Watson data analytics service. Shares of IBM closed 2% higher

In economic news, initial jobless claims came in at 276,000 while Chicago PMI rose to 53.6 in March from 47.6 in February

The Stoxx Europe 600 fell 1.1% Thursday: the Dax lost 0.81%, the FTSE shed 0.46% and the CAC tumbled 1.34%

Banking and telecoms stocks led declines in Europe: French operators Orange and Bouygues said they would extend negotiations around completing their tie-up to the weekend, saying talks were "not yet sufficiently advanced". The news sent shares of Bouygues and Orange sharply lower by 3.64% and also dragged down other French names in the sector including Iliad. The sector closed lower by 1.6%

In the banking sector, Italy's Unicredit could delay a EUR 1.76 billion ($2 billion) rights issue for Banca Popolare di Vicenza, which was set for April, according to a report by Reuters, citing sources. Unicredit shares closed 3% lower and dragged down other Italian banks which are also looking to raise further capital

Eurozone inflation edged higher in March but remained in negative territory, while the UK’s gross domestic product was revised higher in the fourth quarter, but its current-account deficit also came in well above expectations

Spot gold had an inside day yesterday as it closed up 0.5% to $1,232. Supported by the weaker USD, gold's upward tick came as equity markets declined in the afternoon session in New York. Gold stocks: NCM, NST, AQG, EVN, KCN, RMS, SAR, SLR

Crude oil has enjoyed a rise with WTI and Brent up 1.1% and 1.9% to $38.25 and $39.60 respectively. For the month of March, oil rose 14% off its 12-year lows in January. Opec production rose 65,000/barrels a day to 33.09mln/b day. Iran’s production lifted from 2.8mln/b to 3.2mln/b a day in March. Iran still has the capacity to boost production an additional 800,000/b. The April 17 meeting in Qatar will be of great importance for where the world's production levels are targeted for and subsequently the future price of oil. Volatility as we approach this date is expected to rise in speculation. Oil stocks: WPL, STO, SEA, BPT, OSH, HZN, DLS, AWE, KAR, ORG, SXY

Iron ore prices have declined for a seventh day now, off 0.8% to $53.75/tonne. With a lack of commentary from the Chinese government about stimulus, the optimism of another burst in commodity demand is waning. The 17% one-day rally in iron ore earlier this month also runs the risk of keeping higher-cost miners in the game in hope, who’d have previously been ready to enter maintenance-only phase. Iron ore stocks: FMG, BHP, GBG, GRR, MGX, RIO, ARI, BCI, SDL

Base metals were generally up as inventories fell slightly in aluminium, nickel and zinc. Copper fell away 0.3% over demand concerns for the fifth day now and its longest downward run since January. This relates to our comments on iron ore. While central banks around the world continue talking, it’s the numbers that show how things are really going. S&P is looking to cut China’s credit outlook. Copper stocks: PNA, OZL, SFR; Nickel stocks: WSA, SIR; Aluminium stocks: AWC

AIG Australia PMI for March due 0930 Sydney time

RBA March commodity price index due 1630

S&P/ASX 200 fell 4% in three months to March, declining for third quarter in four

Not all mining commodities are going through tough times. Lithium has seen an enormous surge in demand given the growth in Tesla, Honda and Toyota’s hybrid cars and home batteries. We have previously flagged PLS as a stock to watch as it consolidated in an upward triangle.

Breaking out on Wednesday on strong volumes, PLS held up well yesterday. A retracement to $0.405 is possible but using this level as a new floor offers a new stage in the share price. Fibonacci extensions offer an early price target of $0.54.

The Canadian GDP came out the strongest since 2013, so USDCAD dipped towards the key support level 1.2840 but it bounced right back. AUDUSD broke above 0.77 handle again to make a new high 0.7722 which is just below the 100% extension of the inverse head and shoulders formation.

While the upside momentum still exists, AUDUSD appears to trade at an overbought area and the overnight price actions suggest some scope for possible reversal in the near term. Today’s major focuses are the Chinese Caixin PMI at 1245 and the nonfarm payroll at 2330.

Source: Saxo Bank

AUS200.I

Yesterday we saw a typical month end/quarter-end window dressing in AUS200 as the buyers came in to lift the markets towards 5,100 which is the key resistance level. The e-mini S&P500 showed some weakness with choppy price actions ahead of tonight’s nonfarm payroll figures.

Once again the performance of the big four banks would be the key to determine the direction of AUS200 as we witnessed a glimpse of a recovery yesterday. We expect some pull-backs from yesterday’s aggressive gains and 5,100 should remain as a resistance level.

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Tradingfloor.com permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Tradingfloor.com and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Tradingfloor.com is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Tradingfloor.com or as a result of the use of the Tradingfloor.com. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through Tradingfloor.com your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. Tradingfloor.com does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer